Somaliland: Genel Energy’s Purported Reasons for Withdrawal

Somalilandsun—Genel Energy, which has been conducting oil exploration work in Somaliland for the past 18 months has stopped all its work and left the country. There has not been any official announcement from either Genel Energy or the Somaliland government in relation to this sudden development.

However, all the contractors and workers of Genel Energy have been informed that the work has stopped and that all their contracts have been terminated. More seriously, all expatriate Genel staff and management have been ordered to leave Somaliland, according to people close to both the Somaliland government and Genel Energy.

Genel Energy was due to start the first phase of a major exploration work within the next ten days and all the preparations have been concluded, according to government officials who did not wish to be named, as they were not authorised to discuss the matter.

The company has cited security as the reason for leaving Somaliland, however, this has been disputed by different government officials and security experts. Somaliland security officials stated that there have been security issues in the past and that Genel has worked together with Somaliland and British security services, who fund and train Somaliland security officials, each time an issue arose, and the problems were resolved. On this occasion, however, the security officials stated that neither they or their British counterparts are aware of any security threats.

A high ranking government official stated that Genel Energy’s reason for halting its operations and leaving the country are political and not security. ‘Genel Energy is in breach of its contract with the Somaliland government and it has chosen to align itself with Somaliland’s detractors. The government is looking into the matter and will take whatever appropriate actions that’s necessary, and will ensure that, be it now or in future, those companies that behave in this manner will not be able to benefit from their actions’ added this official.

‘If certain countries think that Somaliland can be forced to reunite with Somalia through economic pressure, they are ill informed. They do not know the Somaliland people’ said an expert on Horn of Africa Mr Ali Saleh, who argued that Genel Energy’s sudden and surprise departure was due to external political pressure. Mr Salah went on to say that the most likely source of the pressure on Genel Energy was the British government in conjunction with the Somalia interim government. ‘They want to force Somaliland to its knees through political and economic pressure, so that it accepts the British led road map for Somalia.

Most government officials refused to go on the record discussing this matter, however, when we asked an official from the President’s office if there have been external pressure on the company to leave Somaliland. He stated: ‘There have been ongoing Somalia-Somaliland talks in different countries, mainly Britain and Turkey. There have also been conferences aimed towards restating peace in Somalia. The government of Somaliland attended the bilateral talks, never the less, refused to take part in certain conferences and initiatives for Somalia. This has upset some countries’ said the official. He added that Genel Energy is joint owned by Turkish and British investors, the two principal coordinators of the Somalia efforts. And this latest incident is against the agreements that were reached in turkey, therefore, Somaliland will have to reconsider its further participation in these talks.

Another senior government official who refused to be identified, as per regulation, stated that Somaliland has been through this before, mainly from Arab countries, when they sanctioned the export of Somaliland’s life stock and that did not achieve its purpose. Therefore, this latest effort will also fail.

When asked what action Somaliland will take in response, the senior official stated that they will reconsider their continued participation in the Somalia-Somaliland dialogue. He added: “We might also look to China, Russia or Iran or some of these other knowledgeable and resourceful countries to assist us in exploring our energy sector” concluded the senior officer.